Protein secretion is a fundamentally conserved process that provides a mechanism for cells to create stable Intracellular compartments such as the ER, Golgi, lysosome and plasma membrane, and to communicate with other cells and tissues. A molecular mechanistic analysis of this process in Saccharomyces cerevisiae has uncovered genes and mechanisms that are shared among all eukaryotes. This proposal extends a new line of investigation that I initiated in my previous competitive renewal concerning the mechanism of vesicle traffic from the Golgi complex and particularly the pathway of traffic from the trans Golgi to the cell surface. Evidence has emerged to suggest multiple paths of vesicle formation from the trans Golgi, one of which involves sorting a subset of secretory and vacuolar proteins in the pre-vacuolar compartment, or late endosome. Another involves sorting of early endosomal resident proteins and biosynthetic forms of cell surface membrane proteins. Genetic and cell fractionation studies are proposed to discover the genes that govern sorting of cell surface precursors in the early and late endosomes. A genetic approach is described to identify the sorting signal on a membrane protein that is directed from the early endosome to the nascent division septum. A biochemical approach has been developed to explore the exact function of gene products associated with vesicle budding from the trans Golgi/early endosome in yeast. Transport vesicle formation has been reconstituted from lysates of yeast cells. Vesicle formation is assayed using a differential centrifugation step that separates Golgi membranes and secretory vesicles. This assay will be used to purify and reconstitute proteins required in the budding event. The pathways of vesicle traffic from the yeast Golgi membrane extrapolate to the same event in human cells. As a result of this conservation, yeast cells have been used as a convenient vehicle for the expression and secretion of commercial quantities of therapeutic human proteins. A mechanistic appreciation of the details of vesicle traffic in yeast will also illuminate the pathology of human diseases that impinge on the secretory pathway.